One of a landlord’s worst nightmares is a tenant who doesn’t pay the rent. It can present an uncomfortable dilemma. What should you do?
In this post, we’ll discuss some options for dealing with tenants who don’t pay the rent.
Communicate. The first thing to do, and to do quickly, is to communicate with your tenants. In some cases, a proactive email reminder before the rent is due may help avoid the situation of late or nonpayment. But, if the payment has not arrived on time, immediately contact the tenant to find out what is going on and obtain a commitment (we recommend a very short time frame) to a payment date.
Serve Legal Notice. If the tenant fails to respond favorably or the commitment was not honored, immediately send a notification letter. Requirements and procedures may vary from state-to-state, so make sure you follow the appropriate legal guidelines. The point is, most states offer tenants far more protection than they do landlords, so getting your legal process in order is a must.
Offer to “Buy Them Out”. Many landlords don’t consider this option because their mind set is, “Why should I offer a deadbeat tenant money when they owe me money. The simple answer is that, in the long run, it may save you time and a lot of money. Bear in mind that every day that you are not receiving rental money represents a loss of income. Evictions can drag out for lengthy time periods. They can also create a great deal of ill will. As a result you run the risk of damage to your property by an irate tenant. The cost of future repairs adds to the loss of cash flow.
Start Eviction Procedures. No one welcomes the hassle and expense of an eviction, but at times it is unavoidable. As with the notification, know the laws governing your areas thoroughly and follow them explicitly.
Dealing with tenants who don’t pay the rent is one of the many hassles confronted by landlords. The key to protecting your investment as much as possible is to act quickly and within the guideline of the law.
Unfortunately for landlords, the many hassles of renting can result in negative cash flow and the prospect of needed upgrades. It is important to evaluate your expenses, cash flow and future expenses and appreciation outlook to determine the value of retaining a rental property. Sometimes, selling the property is the best financial alternative. If the property is presenting a considerable drain on your finances, you may want to ask yourself, “ Do you need to sell the house fast?” “Do you need an as is house sale?”
Liquidating quickly may be a better strategy in the long run as it minimizes additional expenditures and time on the market. For example, if you want to sell a house in Portland quickly, an “as is” house sale is less risky because of the current high demand for houses, particularly rentals.
How do you deal with tenants who don’t pay their rent?
Do you have a piece of property (house, lot, or land) you’d like to sell fast? Fill out our Sell Fast Form and get a cash offer within one hour of us viewing the property.